Elephant Cloth which looks like early computer game

When I saw this beautiful cloth I loved it and wanted to post it.  It is in the current Exhibition at the excellent Asian Civilisations Museum in Singapore entitled: Patterns of Trade: Indian Textiles for Export 1400-1900.

This wonderful elephant was manufactured in the late 18th or early 19th centuries in Gujarat for the Dutch East India Company, which used the cloths for gifts to local rulers in their trade and possessions in what is now Indonesia.

As the caption itself notes, the weaving technique produces a pixelated effect like a 1980s computer game!

Global trade and globalisation are of course nothing new.

How Technology will change the World in 2012

I make no claims for originality in these predictions. A characteristic of our connected social media world is that we take our ideas from everyone else – and these are no exception…

  • With “the integration of everything”, apps will work on smartphones, computers and TVs everywhere. You’ll access your email, social media and applications on any device anywhere.
  • The Cloud will turn computing into a utility (at last – after many years of predictions). This will open massive expandable computing power on demand.
  • The Cloud will be not just for businesses but individual consumers. Look at how Facebook – operating in the Cloud – is conquering the world. And Apple’s personal assistant app, Siri – Steve Jobs’ final initiative – will open an infinity of new apps which will learn what you want and, in time, even how you think….
  • Kindle and iPad were the big commercial volume successes of 2011, meaning that Amazon and Apple will be major platforms for – and could also become major publishers for – what we used to call books, films, magazines and newspapers.
  • The TV will be the revolutionary technology device of 2012, with intelligence provided by connectivity from pads and smartphones, no longer presenting just TV channels but everything that is out there on the net and becoming a key element of social media.
  • Social media will continue to grow and will continue to revolutionise  the way we shop, how people remove tyrants, spread our new ideas, connect with friends, family and fellow enthusiasts globally – in short, everything…

Truly a Global Industry

I very much enjoyed the Airline Business 10th Airline Strategy Awards last month.  Perhaps we are all rather cynical about awards ceremonies these days but this was definitively the one to win – just look at who has won it in the past!   The panel is always composed of senior and respected figures from the air transport community and the judging process is rigorous. (And it is always a good night out too!)

The reason for this blog is that these Awards are also a good indicator of the changing nature of the air transport Industry.  So looking back over the last decade you can see the rise of the Alliances, then the low-cost Carriers and the Hybrids.

The choices this year were good ones. I liked the Environment Award for British Airways, richly deserved by Jonathon Counsell, and Qantas were a worthy winner of the IT Award for their RFID “Q” bag tags.

I want, though, to highlight two awards which show in particular how the airline business has changed in the last 10 years:

First, the Award for Leadership which went to Mr Kong Dong, the Chairman of Air China. As the citation said, “Under Kong, Air China has demonstrated that a large airline can respond nimbly to rapidly changing market conditions.  It is positioned for both near-term and long-term growth and, just like its country, becoming a global force”.

Secondly, the Airline Business Award “for the outstanding contribution over the last 10 years”, which was given to Tim Clark, President of Emirates.

The three Airline Business editors

This award was given by the last 3 editors of Airline Business (above) and, as the citation says, “A decade ago when the first Airline Business Awards took place, Emirates was operating just 40 aircraft and carrying 7 million passengers. That fleet now numbers more than 150, and by its last financial year to 31 March, passenger numbers had ballooned to a whopping 31.4 million”.

These two awards very clearly illustrate the shift in the aero-political centre of gravity to the Gulf and to China, mirroring the geo-political shift that has taken place over the last 10 years.

SITA’s members recently decided to amend our Articles of Association to improve our Governance, creating a new SITA Council to look after Members’ interests and a single SITA Board (replacing the old two-tier structure) to supervise the operation and management of SITA.

Again, the membership of these two governing bodies shows the global nature of air transport, with Council members coming from all regions in the world, but absolutely representing the areas of new growth as well as the traditional large carriers with Europe (9), Asia (11), Africa (3), North America (4), South America (2) and Australasia (1).   So as well as Delta, American and United; BA, Air France and Lufthansa: we have Air India, Air China and ANA; Ethiopian, Turkish and TAM on the new SITA Members Council, reflecting their use of SITA products and services.

This is a very international Council that represent airlines large and small, in alliances and not in them, from all parts of the world, showing just how the airline business is growing and changing.

We are truly a global industry now, not just an industry that operates globally.

Customer Interaction – the next frontier for Airline IT

The 11th SITA/Airline Business IT Summit held in June in Brussels was, I think, the best yet.

I had the hard task at the end of the Summit – after a string of fascinating and lively speeches and presentations – of summarising those contributions.  This is what I said then.

Our first speaker was Peter Hartman, CEO of KLM, who told us about his team of over 20 members who drive KLM’s social networking strategy.  They were responsible for the ground-breaking initiative at Schiphol where they delighted passengers waiting to Board with small presents, tailored to their destination and their interests (as inferred from their Facebook or other social presence).   As Peter said about social networking, “Do it, don’t talk!”

Peter predicted that in future people will choose the airline they fly on through the recommendations of their social media connections.  After all, most of us use Trip Adviser now to check out hotels in advance.

In response to questions, Peter returned to the basics of what CEOs expect from Airline CIOs – the technology needs to work reliably and to costs must keep going down!

Dr Munir Majid, Chairman of MAS, talked about the convergence of technology in a “flattening World”.  Dr Majid argued that innovation matters for survival – something he illustrated with Malaysian’s innovative use of Facebook for Group bookings.

Jan Albrecht, CEO of the Star Alliance, stressed the importance of doing more IT for less.  He saw it as essential that airline IT departments provided users with modern IT tools and technology that worked with app-like ease.   Fresh thinking was essential these days in the new social-networked world.  He mused on what Steve Jobs would do for airline technology.   He asked how we as an industry could catch up with our customers’ expectations.

Having had a challenging start from the CEOs on both social networking and getting the basics right, the audience of IT Directors and CIOs returned (after a nerve-steadying cup of coffee) to a technical session on Cloud Computing.

This was a double act from Vivek Badrinath and Francesco Violante, the CEOs of OBS and SITA.  They described what I believe is going to be a game-changer for the Air Transport Industry – the Industry’s own private Cloud.  OBS and SITA described how they would provide on-demand services from a network of six data-centres in five Continents to airlines and airports – consistently, securely and cost-effectively.  Francesco pointed to the possibility of savings from virtual CUTE and SSKs, and on-demand apps.

After lunch, we were privileged to hear two industry technology experts who attempted to shock the audience: Philip Wolf, CEO of PhoCusWright, looked at how mobility and connectivity were transforming today’s travel industry. Online booking was continuing to grow and there would be 2billion new travelers by 2030.  “What would the impact of a travel app from Google be?” he asked.  His challenge to the audience was to wake up to the impact of mobility and connectivity – these days, devices know where you are, who you like and what you want.

Then Nawal Taneja, Professor of Aviation at Ohio State University, warmed to this theme and urged airlines to provide genuinely personalized service.  What if Google or Apple could take over the retail distribution of airline services? Then, he warned, the airlines would become simply the ‘manufacturer’ of seats!

Chris Klingenberg, CIO of Lufthansa (and fellow SITA Board member), provided what he termed an antidote to all this very technology-based agenda.  He said airlines would not be so foolish as to give away their “crown jewels” in the form of the link to their customers.  They would remain masters of their own destiny.   He also advanced the refreshing notion that you should be proud of higher IT spend than your competitors since this showed you were innovating ahead of them.   He advocated bringing IT out of the “Techie Corner” and getting the Boardroom to understand how important it was.  Great points, I thought!

We then finished with two excellent contributions, the first from Antoine Rostworowski, of Aeroports de Montreal, who stressed the importance of integrating airports into the new visions for airline passengers.  Then Qiang Li, MD of Information Management at Air China, talked about the challenges of massive growth that they face.  He came up with a tremendous list of the IT initiatives he is leading, which would form a great ‘to do’ list for any airline CIO:

  • Cloud Computing
  • Mobile
  • Social Networking
  • Passenger Service Systems
  • Customer Relationship Management, and
  • In-flight Connectivity.

So then I had to try to summarise what all this adds up to!  I think the most important fact is that there was total agreement between CEOs and CIOs, analysts and suppliers, airlines and airports, that IT really matters in the modern world.

We have heard that before and it is really important.  But there is another new factor: we in IT are now central to the airlines’ and airports’ relationship with customers through game-changing technology – mobility is now ubiquitous and social networking adds a completely new dimension to customer relationships.

So, IT matters – and that’s now widely recognised.

And IT is central to airlines in operations, in selling, in servicing and, now, in customer interaction.

Is this the most diverse company Board in the World?

There are few IT companies or airlines which have lasted as long as SITA – the Société Internationale de Télécommunications Aéronautiques – which was 61 years old this February, and which I currently have the privilege to chair.

So what can the global business community learn from an IT and telecommunications co-operative founded in 1949?  We have 550 members from across the global air transport industry, have a turnover of $1.5bn and operate in 220 countries and territories across the world, with colleagues who speak 70 different languages.

Having recently returned from one of SITA’s Quarterly Board Meetings, I am struck yet again by one of the attributes that makes SITA unique: the diversity of our Board.

Now, SITA exists purely because we, the Air Transport Community, want it to exist and because we find it useful.  SITA gives us, its customers – who are also SITA’s owners – real choice, since it has the largest portfolio of systems, solutions and services in the air transport business.

At the heart of SITA is the concept of Community: a belief that people, nations and companies need to work together to produce wealth, health and happiness. SITA is owned by its customers – most of them the airlines – who use SITA’s systems, services and networks.

The Board comprises the 20 largest users in the previous year, plus representatives of nine regional airline groups and three co-opted Board members.  So we, the users – the shareholders and Board members – can, and do, direct SITA strategically.

Our stake in SITA is determined not by how much money we have put in historically, but by how much, in the year just gone by, we have used SITA’s systems and services. So if you stop using SITA, you lose your Board seat and lose your ability to help set the strategy.  It’s very simple: your stake is based on your use.

So let’s look at the Board composition generated by this unique governance structure: it is made up of airlines from every region of the globe.  We have Board members from Europe, China, South Asia, East Asia, Japan, Australia, the Middle East, North and South Africa, North America and Latin America – although it is true we are missing Antarctica!

We have carriers from each of the three major global airline alliances and non-aligned carriers both large and small.   We have a representative of a cargo airline, an airport and a global distribution system (GDS) as well.   And, perhaps most surprising of all, we have Board members – and long have done –  from competitors of SITA who are also SITA’s customers.

All this means that SITA benefits from a unparalleled diversity of experience and advice from its non-executives, who have as good a view of the state of the air transport industry as any group could have, and we benefit greatly as a company from this unique governance.

So I believe that SITA is probably the most diverse commercial company for its size in the world. We are also a co-operative – but a determinedly commercial one – and much the better for it!

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